Factoring Company- Glossary > Factoring Terms > Factoring

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A form of accounts receivable (invoice) financing involving the sale of accounts receivable to a factoring company either with or without recourse. Factoring can be on a notification or non-notification basis. In a notification agreement, the seller's customers will make payment directly to the factor. A credit check is usually made on the seller's customer; so the factor can serve as a credit information resource for the seller.

Last updated on September 26, 2009 by FACTOR KING, LLC